Procedural deposit cannot be appropriated by a bank when made only to show bona fides in settlement talks.

A deposit made before the High Court solely to demonstrate bona fides in a one-time settlement process, and expressly kept with the Registry, could not be appropriated by the bank. The SC applied the principle that a secured creditor may proceed only against identified secured assets, and held that money deposited for a collateral procedural purpose is neither a secured asset nor secured debt. Because the amount was not paid in satisfaction of the debt and no lawful basis or consent supported retention, the bank had no lien or right of set-off. The deposited amount was therefore refundable to the borrowers with accrued interest.

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Issues: Whether the amount deposited before the High Court to establish bona fides while pursuing a one-time settlement proposal could be retained by the bank or had to be returned to the borrowers.

Analysis: The deposit was made only to show bona fides and was expressly directed to be treated as a deposit in the Registry of the High Court. Applying the principle that a secured creditor may proceed only against the secured assets identified in the notice and that a deposit made for a collateral procedural purpose is neither a secured asset nor a secured debt, the Court held that the bank had no right to appropriate or retain the amount. The Court also relied on the distinction between money kept with the tribunal or court registry and money in the bank's custody, and rejected any claim of lien over such deposit.

Conclusion: The amount deposited by the borrowers was refundable to them and could not be retained by the bank.

Final Conclusion: The borrowers were entitled to withdraw the deposited amount with accrued interest, and the High Court's direction permitting continued retention was set aside.

Ratio Decidendi: A deposit made only for a limited procedural purpose, and not in satisfaction of the debt, does not become a secured asset or secured debt and cannot be appropriated by the bank absent a lawful basis or consent.

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